DES GB2015 Englisch

WILHELM WELLNER: It is indeed the case that we didn’t manage to acquire a new shop- ping center in the last financial year, although we investigated a number of offers on the transactions market and also submitted a purchase offer. But we remain on the ball. In Dessau we enhanced the attractive location of our Rathaus- Center by acquiring a property integrated in our center, which will con- tinue to be let to Karstadt. This acquisition is an economically viable investment from a long-term perspective, ensuring a complete retail offering under a unified, professional management for our customers and tenants in Dessau. OLAF BORKERS: We have two new food courts. Since the end of November City-Point Kassel’s “Food Point” has offered nine res- taurants over approximately 1,200m2 featuring international cuisine, seating for 200 people and an outside balcony with expansive views The opening of “Foodie” with seating for around 300 patrons in March completes the expansion of the Phoenix-Center in Hamburg-Harburg. Since September 2014 we had been expanding and modernising the appearance of the popular shopping center with our investment part- ners in three stages, at a cost of around €30 million. Its retail space has been expanded by just under 10 per cent to 29,000m2 . We have also made progress with our expansion plans for the Galeria Baltycka.We are still working on the construction permit, some- thing that is, however, a time-intensive endeavour in central inner city locations. The aim is to expand the center in the Polish city of Gdańsk by around 15,000m2 of additional rental space with some 70 new shops. Our investment would amount to around €50 million. WILHELM WELLNER: Our rent system is based on the turnover of our tenants and is also linked to developments in the consum- er price index, i.e. inflation. We expect the latter to rise only slightly in 2016. This was also the reason for our minor amendment to the guidance in autumn 2015. Based on this low inflation forecast, we expect stable revenue of between €200 million and €204 million this year.We see EBIT in a band- width between €175 million and €179 million, and a slight rise in EBT excluding measurement gains/losses to €127 million to €130 million. And finally, we expect funds from operations, the key factor for divi- dends, to come in at between €2.26 and €2.30 per share. There has not been much activity in the portfolio. Only the acquisition in Dessau? What is the operational outlook for 2016? Apropos low inflation: Interest rates are still plummeting. Can Deutsche EuroShop benefit from this? What else is new in the centers? OLAF BORKERS: Yes, because while the on- going low inflation rate slows growth from in- creasing rental income, we also benefit from the low interest rate level. We were able to conclude refinancing at significantly lower interest rates in 2015 and expect refinancing opportunities to remain favourable in 2016. As a result, our inter- est expense will be measurably lower this year and next. As the major loans with interest rates of just under five per cent only expire in three to five years, I see enormous potential to optimise our costs. Thank you for talking to us. This interview with Wilhelm Wellner and Olaf Borkers was conducted by Patrick Kiss during a tour of the Phoenix-Center Harburg. 10 Deutsche EuroShop AG Annual Report 2015 INTERVIEW

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